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"Should the central bank continue to hint at further rate delays, we could see the dollar sell-off resume, in which case most commodity markets including gold could push higher."
- INTL FCStone (based on Reuters)
Pair's Outlook
A sharp drop of gold prices on Friday followed its inability to consolidate above the 1,263 resistance one day before. With prices plunging as low as 1,232 on the last day of the previous week, the bullion created a dangerous precedent by closing below the 55-day SMA for the first time since January. In case there is no rebound over the next 24 hours, we are going to shift our attention to the 1,216 mark, namely nearest possible support represented by the lower Bollinger band in cooperation with the weekly S1. Upward risks are dampened, as there are formidable resistances located in the 1,235/43 range.
Traders' Sentiment
Bullish side gained only two pp from Friday until Monday, on top of two pp it had added on Thursday-Friday. Now there are 36% of long positions, meaning the bears are safeguarding a majority of 64%.
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